NEWS: COP 23 EDITION

LONDON, 19 November – The rulebook for market mechanisms in the Paris Agreement progressed slowly over the two-week UN climate talks in Bonn, ending with a mandate for a draft negotiating text to be ready by March.

The Paris Agreement’s market provisions appear in its Article 6. It establishes an accounting framework for international trading and an emissions mitigation mechanism, drawing from the experience with the Kyoto Protocol crediting mechanisms.

The Bonn talks focused on draft headers and the key policy elements needed for making the provisions operational. The constructive talks ended in a rocky finish, when countries gave a mandate to the chair of the Subsidiary Body overseeing Article 6 to prepare a draft negotiating text ahead of the next meeting in April. This text will draw on three informal notes prepared over the course of the talks.

While IETA had called for a draft negotiating text to emerge at Bonn, the work done over the two weeks made substantial progress in laying the foundations for the next steps. Governments also finalised the format and process for the first Facilitative Dialogue, now renamed the Talanoa Dialogue, which will assess progress on cutting emissions and future trajectories. The Fijian President of COP 23 offered the name “Talanoa” to describe the process, using the Fijian word for frank and open dialogue.

“We are starting to get a clearer picture of how governments envisage Article 6 operating, although there are a number of thorny issues to resolve. We also need more clarity on how countries will use it in their national policies,” says Dirk Forrister, President and CEO of IETA. “Over the coming months, we urge governments to accelerate their efforts so that business can start investing and driving forward the low-carbon transition.”

“As the Talanoa Dialogues progress, governments will consider how and when to strengthen their Nationally Determined Contributions to achieve the Paris goals, so it will be essential for them to understand how the market flexibilities in Article 6 will work to enable greater ambition.” he adds. “A well functioning international market can tap the power of the private sector to invest at scale and deliver emissions cuts at low cost. That’s why it is key to unlocking more ambition.”

BONN, 16 November – IETA and the Climate Markets & Investment Association (CMIA) are proud to announce the Pacific Alliance as the final winners of the Carbon Pricing Champion Award at COP23.

The two groups awarded the honour to the Pacific Alliance nations – Chile, Colombia, Mexico and Peru – in recognition of the Cali Declaration. In this statement, issued following a summit earlier in the year, the four nations announced their intent to increase efforts to measure and report emissions and to look at establishing a voluntary regional emissions trading market. This move to explore a market is a significant step for the region, and the cross-border collaboration of the four nations could act as a model for other countries in Latin America.

“The Pacific Alliance nations are a worthy recipient of the Carbon Pricing Champion Award for their efforts to use market forces to cut emissions and build a regional carbon club through aligned climate policies,” says Dirk Forrister, President and CEO of IETA. “Not only could this inspire others in Latin America to follow their lead, it has the potential to create a broader Pacific Rim carbon market. Collaborative efforts will help reduce emissions faster and cheaper than going it alone, and the leadership shown by Chile, Colombia, Mexico and Peru is to be commended.”

“The Pacific Alliance is a stand out example of regional collaboration, allowing these countries to take advantage of global trading schemes as well as increase investments in actions and new technologies that lead to low-carbon economies,” says Margaret-Ann Splawn, Executive Director of CMIA. “In addition, since this region holds considerable forest reserves there is the possibility of offering compensations at the global level.”

The award was presented this evening to Chile’s Environment Minister Marcelo Mena at the IETA Business Hub.

IETA and CMIA would like to thank Ecosphere+ and its CEO Lisa Walker for their continued support of the award. Ecosphere+ is a new venture founded by the Althelia Climate Fund to build markets that put a value on standing forests, incentivise sustainable business models and responsible supply chains.

NOTE TO EDITORS

Mexico introduced a carbon tax in 2014, and is working on rules to accept certified emission reductions in lieu of payment. Colombia has followed suit, and introduced its tax-and-offset programme this year, and Chile’s carbon tax came into force this year. Peru meanwhile is exploring opportunities to create a crediting mechanism to cut emissions in its key sectors. All four nations are being supported by the World Bank’s Partnership for Market Readiness initiative.

About IETA:IETAis the voice of business on carbon markets around the world. Established in 1999, IETA's members include global leaders in the oil, electricity, cement, aluminium, chemical, technology, data verification, broking, trading, legal, finance, and consulting industries.

About CMIA:

CMIAleads a global coalition of private sector actors since 2008. Our diverse membership is comprised of companies and organisations involved in shifting the trillions that will enable a transition to a low-carbon global economy through climate policy, finance and investment

BONN, 9 November – IETA and the Climate Markets & Investment Association (CMIA) are proud to announce the first Carbon Pricing Champion Award at COP23 to the government of New Zealand.

The two groups awarded the honour to New Zealand in recognition of its ETS review outcomes, which will bolster the market’s environmental integrity and allow it to be more adaptable to changing circumstances. The reforms, which include five-year rolling supply decisions and a move to auctions, provide clarity and certainty over the future direction of the domestic market, which is now in its tenth year. The changes will also increase the New Zealand system’s harmonisation with other markets, leaving it well-positioned for potential linkages that offer the potential to improve efficiencies and lower costs for participants over time.

New Zealand is recognised for its leadership on carbon markets the international arena as well. At COP21 in Paris, it launched the Ministerial Declaration on Carbon Markets, which has grown in signatories. The group highlights the important role that international market mechanisms will play in enhancing mitigation ambition under the Paris Agreement. This year, the group continued its cooperation in considering standards and guidelines for the environmental integrity of international market mechanisms.

“The improvements that the New Zealand government is making to the ETS are yet another example of the leadership the country has shown on carbon pricing over many years, and make it a very worthy recipient of the first Carbon Pricing Champion Award at COP23,” says Dirk Forrister, President and CEO of IETA. “New Zealand’s market has operated for 10 years, and the changes will strengthen the market and enhance its flexibility and adaptability. Policy certainty and clarity are vital for businesses, which are making long-term investment decisions now.”

“New Zealand has been notably consistent in putting carbon pricing at the heart of its low-carbon development plan and NDC,” says Adrian Rimmer, CMIA President. “This award recognises that the new government is not only ensuring clarity for investors by maintaining support for its current market-based policies, but also by showing global leadership through increasing its ambition - such as its plan to shift to 100% renewables by 2035.”

The award was presented this evening to Kay Harrison, lead negotiator for markets for New Zealand, at the IETA Business Hub.

IETA and CMIA would like to thank Ecosphere+ and its CEO Lisa Walker for their continued support of the award. Ecosphere+ is a new venture founded by the Althelia Climate Fund to build markets that put a value on standing forests, incentivise sustainable business models and responsible supply chains.

About IETA:IETA is the voice of business on carbon markets around the world. Established in 1999, IETA's members include global leaders in the oil, electricity, cement, aluminium, chemical, technology, data verification, broking, trading, legal, finance, and consulting industries.

About CMIA:

CMIA leads a global coalition of private sector actors since 2008. Our diverse membership is comprised of companies and organisations involved in shifting the trillions that will enable a transition to a low-carbon global economy through climate policy, finance and investment

Tomorrow sees the start of activities at IETA's Business Hub at COP23, as negotiations also get into gear. Over the next two weeks, IETA and our partners have prepared a packed schedule of events, covering topics such as CORSIA, Article 6 of the Paris Agreement, Canadian climate action, clean technology and forestry, and much, much more! Check out our dedicated COP23 website for the latest information and programme guide.

Our hub is located on the ground level of the Bonn zone, near the Japan and Korea pavilions. Stop by for a coffee and discussion with your peers from around the world!